I’m not suggesting “removing limited liability,” because this would both be changing the rules of the game for existing shareholders and of course be vehemently opposed by existing firms. Rather, we need for states to start deregulating for small businesses whose owners/shareholders do not hide behind limited liability, live in the communities in which they operate and hence are susceptible to claims of damage by local people. There’s no reason to think that these organizations would remain tiny; Lloyds of London used to be a huge syndicate of unlimited liability names, Amex used to be a LISTED unlimited liability corporation, and there still are some fairly large partnerships.

As I have said elsewhere, “a curtailment of limited liability for torts could be hedged by shareholders via insurance, and could be achieved by state governments and the federal government offering more lenient regulation to business enterprises that operate as partnerships, unlimited liability corporations, or in cases where shares are NOT “fully paid up” so that calls for significant additional capital could be made against shareholders if needed to pay claims. “Creative destruction” by new firms will eventually bring down the limited liability firms.”

On climate, why are so many anarchists/libertarians/conservatives part of a Bootlegger-Baptist coalition that protects the crony status quo?

Could it be that tribalism and confirmation bias makes hating on lefty enviro-fascist watermelon commies so much fun?

Is there a “burden of proof” before we have to start criticizing government ownership/mismanagement of resources, grants of public utility monopolies that crush competition and consumer choice, pollution regulations that provide free rights to pollute (and grandfather the dirtiest polluters), and government creation of corporations that provide grants of limited liability to investors?

“[D]espite many theories justifying government because its activities produce benefits to its citizens, no government was ever established to produce those benefits. Governments were created by force to rule over people and extract resources from them. Thus, the argument that citizens would be better off if they replaced government activities with private arrangements and market transactions is irrelevant to the issue of whether an orderly anarchy would be a desirable—or even feasible—replacement for government. The real issue is whether a group of people with no government can prevent predators both inside and outside their group from using force to establish a government. …

“The evidence shows that anarchy, no matter how desirable in theory, does not constitute a realistic alternative in practice, and it suggests that if government ever were to be eliminated anywhere, predators would move in to establish themselves as one by force. One can debate the merits of anarchy in theory, but the real-world libertarian issue is not whether it would more be desirable to establish a limited government or to eliminate government altogether. Economist Bruce Benson notes, “When a community is at a comparative disadvantage in the use of violence it may not be able to prevent subjugation by a protection racket such as the state” (1999, 153). Libertarian philosopher Jan Narveson writes, “Why does government remain in power? Why, in fact, are there still governments? The short answer is that governments command powers to which the ordinary citizen is utterly unequal” (2002, 199–200). …

“[S]ome governments are better than others. Therein lies the libertarian argument for a limited government. People benefit from an institutional mechanism to prevent their being taken over by a predatory gang. They can provide this mechanism by preemptively establishing their own limited government, in a form they themselves determine, not on the terms forced upon them by outside predators. A government created by the people themselves can be designed to produce the protection they desire while returning to them the bulk of the surplus owing to peaceful cooperation rather than allowing the state to retain it.

“Is it really possible to design a limited government that will protect people’s liberty? Despite the challenges, it is well-known that some institutional arrangements do a better job of securing liberty and creating prosperity than others. Nations that have protected property rights and allowed markets to work have thrived, whereas nations that have not done so have remained mired in poverty. A libertarian analysis of government must go beyond the issue of whether government should exist. Some governments are more libertarian than others, and it is worth studying how government institutions can be designed to minimize their negative impact on liberty. This proposition is obviously true if one believes that government is inevitable, but even advocates of orderly anarchy should have an interest in understanding how government institutions can be designed to maximize their protection of liberty. …

“Although ideas have been advanced as to how institutions might be redesigned to lessen government’s coercive activities (for example, by Tucker 1990; Anderson and Leal 1991; Holcombe 1995; Holcombe and Staley 2001), there may be no final answer to the question of how to design the ideal government because any innovations in government designed to protect the rights of individuals may prompt offsetting innovations by those who want to use government for predatory purposes. The preservation of liberty will remain a never-ending challenge.”

State-made limited liability corporations are the health of the massive Regulatory State, which is likewise the health of the crony corporations. It’s a rachet, and racket.

Are you a Bootlegger, or a Baptist?

In free, voluntary markets, there is no Get-Out-of-Personal-Liability-for-Harms-Caused-to-Others-Free Card.

Limited liability for shareholders is a state-granted favor that is demonstrably at the bottom of the dynamic of people forever running to a gamed “democratic” government, to make government make its creations behave more nicely (with the regulations then serving to protect the big, to limit competition, and to fuel corruption and further government capture). As soon as governments began creating corporate monopolies and/or limited liability cos, then judges followed suit by rejecting strict common-law protections of private property in favor of a pollution-/corporation-favoring “balance” of equities that Block and Rothbard noted.

In a private law society, one finds ALWAYS individuals and associations of individuals who may negotiate liability caps with voluntary counterparties, but remain potentially personally liable up to the remainder of their personal assets for harms that their activities (and those of their agents) caused to others.

While the persons who actually directly caused harms would of course be liable, their principals would try to limit their own potential exposure by either closely managing their agents or making sure that others were independent contractors.

Trust me — you don’t have to agree with those who say “climate science is scary, so we need to do something about it” to be willing to have a decent conversation about how governments play a deep role in generating problems, and seeing ways to use the concerns of “warmers” as leverage to try to start fixing what is broken.

Elsewhere, I got head-scratches when I said, “I think there is little we can do to change temps …, but I still think that there is room for productive “climate” policy.”

I am not one of those who are fine and dandy with this “experiment” and who act as if it is a “conservative” venture or that market or libertarian principles justify it.

Nor, however, am I one of those who think that climate concerns — like other environmental/healthy/safety/welfare concerns — mandate massive further interference with people’s lives and economic activities, in the manner of past interventions.

Governments have been and continue to be hugely disruptive, incompetent and corrupt, and in fact are the friends of the “crony capital” corporations that are the object of popular scorn (but in fact such corporations are made, fed, coddled, catered to and protected from competition and market forces by governments).

So I “get” some of the reflexive whinging by shallow market fundamentalists that the science must be wrong and that “enviros” must be evil — though these people also piss me off, because in effect they are ideologues who are protecting crony capitalists and a very fucked up system, rather than engaging in good faith with people who can see quite clearly that there are no “property rights” or “market prices” in the air that magically direct economic activity “invisible hand”-like towards optimal outcomes.

My suggestions that there are productive climate policies is one that is NOT based on either a certainty of climate science or some false expectation that we could easily “fix” the climate (we can’t), but on the awareness that our current economic order is profoundly corrupt, costly/inefficient, significantly hampers consumer choice and innovation, socializes real (and generally recognized) pollution costs and protects bureaucrats.

And even the deepest skeptic of climate change science and theory ought to be interested in seizing the opportunity of the concerns of others to FIX what is deeply fucked up about economic regulation. That is, of course, unless they’re hooked the adrenaline rush that comes from being a blind, self-righteous ideologue in a “Bootleggers and Baptists” coalition.

Here are some thoughts, both on productive climate policies and on seeing past illusory certainty:

Governments, themselves largely unaccountable institutions guided and staffed by persons who are personally unaccountable, create corporate Frankensteins that are owned, guided and staffed by persons who are personally unaccountable.

When “accidents happen”, our Big Brother may either shrug or rush in to “protect” us some more — in ways that are sure to enhance the power of government and to create more regulations that will reduce competition (and thus favor the existing larger firms in a particular industry), while leaving each of us with LESS power to do anything personally or collectively to protect ourselves — in the case of the massive #BP Horizon blowout, remember how the Feds stopped gulf states and towns from laying out their own booms to limit damage, and stopped people from digging on public beaches to take oil samples?

Corporations, made by the state, are truly “The Health of the State”.

IMAGINE, however, (1) if business was conducted only in organizations whose owners retained potential personal liability (as a partnership, association, or corporation whose shareholders only partially pay-in their equity commitment) and lived adjacent to their riskiest businesses, and (2) if old tort doctrines allowing people whose persons/property were damaged by others’ pollution to enjoin/stop such practices were still respected. In this case, the personal skin in the game of owners/execs, face in the community, personal risk to liability, and agreements with insurers would incentivize all to greatly reduce risk — in a manner that EMPOWERS people in the community around the business operations.